Query on E-Way Bill Generation for Aluminum Scrap Trading

Eway Bill 640 views 2 replies

Abhishek

Accountant

21 Points Posted on 12 March 2025

My client has recently started an aluminium scrap trading business and is based in Delhi NCR. He follows a Bill To - Ship To model, where:

He purchases goods from a supplier.

The supplier generates an e-way bill under Bill To - Ship To (billing to my client and shipping directly to his customer).

My client then issues an invoice to his customer.

First Scenario:

My client wants to generate an e-way bill mentioning "Dispatch From" as the supplier’s warehouse in Gurgaon, even though he is not registered in Gurgaon. The reason for this is to prevent disclosing the actual source of procurement.

Will there be any compliance issues if the dispatch location is not a registered place of business under my client’s GST?

Second Scenario (Involving Four Parties):

Now, consider a four-party transaction involving A, B, C, and D, where:

A (Supplier) sells to B (My Client) (invoice issued by A to B).

B (My Client) sells to C (B’s Customer) (invoice issued by B to C).

C instructs B to deliver the goods directly to their customer, D.

In this case, how many e-way bills need to be generated, and by whom?

Would appreciate insights from experts regarding correct e-way bill structuring and compliance in both scenarios.

Replies (2)

Rama chary Rachakonda

Master in Accounts & high court Advocate

9615 Points Posted on 12 March 2025

Let's break down the two scenarios for your client's aluminium scrap trading business. First Scenario: Generating E-Way Bill with Supplier's Warehouse as Dispatch Location Your client wants to generate an e-way bill mentioning "Dispatch From" as the supplier's warehouse in Gurgaon, despite not being registered in Gurgaon. The reason is to prevent disclosing the actual source of procurement. *Compliance Issues:* - *Potential Issue*: The dispatch location not being a registered place of business under your client's GST may raise compliance issues. - *E-Way Bill Generation*: The e-way bill can still be generated by your client, but it's essential to ensure that the supplier's warehouse in Gurgaon is a valid and registered location for GST purposes.¹ - *Accuracy and Transparency*: It's crucial to maintain accuracy and transparency in e-way bill generation to avoid any potential penalties or legal issues. Second Scenario: Four-Party Transaction In this scenario, there are four parties involved: A (Supplier), B (Your Client), C (B's Customer), and D (C's Customer). *E-Way Bill Generation:* - *First Leg (A to B)*: A generates an e-way bill for the movement of goods from their location to B's location. - *Second Leg (B to C to D)*: B generates another e-way bill for the movement of goods from their location (or the supplier's location, as in the first scenario) to D's location, as per C's instructions. - *Total E-Way Bills*: Two e-way bills need to be generated in this scenario. *Compliance Considerations:* - *GST Registration*: Ensure that all parties involved have valid GST registrations and are compliant with GST regulations. - *E-Way Bill Validity*: Verify the validity of the e-way bills generated for each leg of the transaction. - *Documentation*: Maintain accurate and complete documentation for all transactions, including invoices, delivery challans, and e-way bills. In both scenarios, it's essential to ensure compliance with GST regulations and e-way bill requirements to avoid any potential penalties or legal issues. Consult with a tax professional or financial advisor to ensure accuracy and compliance.